In President Biden's 2½ years in office, there has been a significant manufacturing boom across the country, particularly in the South and Mountain West regions, including several red states. This growth has resulted in the addition of approximately 800,000 manufacturing jobs nationwide. President Biden aims to showcase these job gains, especially those in the union sector, as evidence of his commitment to creating jobs for all Americans. However, former President Trump is also vying for the union vote and attempting to convince auto workers that Biden's focus on electric vehicles may lead to a reduction in factory jobs.
Looking ahead to the 2024 election, Biden's challenge is to establish a connection between his three key legislative pieces—the Bipartisan Infrastructure Law, the Inflation Reduction Act, and the Chips and Science Act—and the resurgence of manufacturing in the country. This sector offers an average hourly pay of $32, making it essential for Biden's electoral prospects. He will face competition from Republican and Democratic governors who can also claim credit for economic growth in their respective states.
According to Bureau of Labor Statistics data, Texas ranks as the top state for new manufacturing jobs, with 86,000 positions created between January 2021 and May 2023. California follows with 79,000 jobs, then Florida with 37,000, Ohio with 31,000, and Georgia with 29,000. Nevada experienced the highest percentage increase at 15%, while Montana and Wyoming saw increases of 11% and 10%, respectively.
To promote his "Bidenomics" and convince a skeptical public that his policies are effective, President Biden visited a Philadelphia shipyard and emphasized how his investments in renewable energy would benefit union workers and create jobs. In response, Trump released a video stating that defeating Biden is necessary for the preservation of the auto industry.
While Biden highlights job growth in red states, he also takes the opportunity to criticize Republicans for opposing most of his proposals. During a visit to South Carolina, he playfully mentioned the prospect of breaking ground for a new solar facility in Rep. Marjorie Taylor Greene's district.
Despite concerns about Biden's handling of the economy, the U.S. economy has defied expectations and continues to add jobs. The possibility of a soft landing for the Federal Reserve's aggressive rate hikes, where inflation declines without a rise in unemployment, now appears more feasible. Goldman Sachs economists have reduced the probability of a recession in the next 12 months to 20%, down from 30% in July of the previous year. However, polling indicates widespread dissatisfaction with Biden's economic management, partly due to partisan views. Anemic wage growth may also contribute to negative perceptions. The Biden administration hopes that by cooling inflation and improving wage growth, public sentiment about the economy will improve.
Nevertheless, there are indications that the manufacturing sector is slowing down, which could undermine a vital aspect of Biden's economic strategy. The Institute for Supply Management's manufacturing gauge dropped to 46% in June, the lowest reading since May 2020. Any value below 50 suggests contracting activity. In a June survey, manufacturers expressed less optimism regarding their company's outlook compared to the previous quarter, with nearly two-thirds of respondents expressing concerns about regulations.
In terms of manufacturing job growth, Arizona and Georgia, which Biden flipped from former President Trump in 2020, have outperformed the national average of 6.4%. Arizona witnessed a 10% increase with 16,000 new jobs, while Georgia's economy added 40,000 jobs, resulting in a 7.5% increase. In three other states that Biden reclaimed for Democrats in 2020—Michigan, Pennsylvania, and Wisconsin—job additions have been significant but with less explosive percentage increases compared to the South and West. Michigan added 24,000 manufacturing jobs (4% increase), Pennsylvania added 28,000 jobs (5% increase), and Wisconsin added 20,000 jobs (4% increase).
For Biden's reelection strategy, a strong economy is crucial. He needs to ensure that the economy continues to add jobs, particularly in states where the outcome of the 2024 election is likely to be determined.